In The Matter Of: 

## SERVED: February 18, 2016 U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS WASHINGTON, DC

Docket No. FAA-2015-2440 COMPASS SYSTEMS & SALES, INC. ) 

### ) ) ) ) Case No. 2014-GL-70-0239 Respondent
ORDER CLARIFYING COURT JURISDICTION AND DIRECTING PROCEDURAL COMPLIANCE IN FUTURE FILINGS
The record demonstrates that the FAA and the Respondent, Compass Systems 

### & Sales, Inc., have filed multiple pleadings and motions, and in many ofthese materials have mistakenly identified the FAA as part ofthe Court. Forexample, onJuly 28, 2015 the FAA filed its Complaint (dated July 27, 2015) with the Court. At thesame time, the FAA also filed aNotice ofAppearance. Both the FAA's July 28, 2015 Complaint and its Notice ofAppearance asserted in thejurisdictional caption that this Court was an employee ofthe FAA. Eight (8) days later, on August 5, 2015, the Respondent, Compass Systems 

### & Sales, Inc., filed its Answer. Not surprisingly, the Respondent utilized the
same erroneousjurisdictional caption, which identified the FAA as part ofthis Court. On August 5, 2015 and August 13,2015, this Court issued Orders 1that providedboth parties with the Court's correctjurisdictional caption: U.S. Department ofTransportation Office ofHearings

Washington, DC On October 29,2015, the partiesjointly filed a Proposed Discovery Plan ("Plan"). This Planproperly identified both the Court and the assigned Docket Number onthe first page.

1August 5, 2015 Notice ofAssignment ofProceeding; and August 13,2015 Order Setting a Rule 16 Litigation Scheduling Conference, and Directing the Parties to Confer and File a Rule 26(t) Proposed Discovery Plan.

## -· Subsequently, however, onNovember 23, 2015, and December 17, 2015, the Respondent has filed multiple documents 2 utilizing the erroneousjurisdictional caption contained in the FAA's Complaint.
A. Clarification Regarding the Court and Jurisdiction The parties' written materials that mistakenly identify the Court as part ofthe FAA in this proceeding are incorrect. Itis an error that keeps occurring in FAA civil penalty cases, despite having been previously addressed by this Court. 3 The error is not insignificant, and should be corrected by both parties in all future filings. Pursuant to 14 C.F.R. §§ 13.16(h)-(i), and the FAA's Rules ofPractice,4 when the Respondent requests a hearing in FAA civil penalty proceedings, the FAA refers the case to the Office ofHearings for independent adjudication pursuant to 14 C.P.R. § 13.202 and 5 U.S.C. § 554. The Office ofHearings is part ofOffice ofthe Secretary for the U.S. Department of Transportation. 

### Itis not an office within the FAA, or under the FAA's control or supervision. In addition, upon referral ofthe case to the Office ofHearings, the FAA Administrator is separated from the proceedings. Instead, the FAA's Regional Counsel or other designated agency attorney is the FAA's complainant litigant, and prosecutes the civil action onbehalfofthe FAA. See, 14 C.P.R.§§ 13.202 and 13.203. Thereafter, throughout the litigation before this Court, the FAA Administrator is neither the complainant litigant in the proceedings, nor does he, orany other FAA employee, serve as the Court in any capacity. 14 C.P.R.§ 13.203. [A]dministrative lawjudges
...are completely independent ofthe ChiefCounsel, and in fact, independent ofthe FAA. 55 Fed. Reg. 27548, 27552 (Jul. 3, 1990) (Discussion ofFinal Rule).

2 Specifically, the Respondent's Notice ofService ofRespondent's First Set oflnterrogatories (etc.); Notice of Appearance ofCounsel, Notice ofService oflnitial Disclosures Pursuant to Fed. R. Civ. P. 26(a), and Respondent's Notice ofCompliance.
3 See, e.g., Birmingham Flight Center, Inc., Dkt: FAA-2014-0867, Order Clarifying FAA Party and the Court's Jurisdiction, and Directing Procedural Compliance in Future Filings (Feb. 27, 2016); Jet Logistics, Inc., Dkt. FAA2013-0290, Order Granting Protective Reliefand Directing Procedural Compliance (May 29, 2014).
4 The Rules ofPractice for this proceeding are set forth in Part 13, Subpart G, ofthe Federal Aviation Regulations (14 C.P.R. Part 13). Page 2 of4The FAA Administrator has explained that referring the case to an independent, U.S. Administrative Law Judge, who·is not an employee ofthe FAA, promotes the FAA's wellestablished public goal offair and impartial decision-making: [U]der the rules ofpractice, the adjudication function is performed initially by administrative lawjudges employed bythe Office ofthe Secretary ofthe Department of Transportation
.... Under the rule's [sic] separation requirements
...[thejudges are not] subjectto the [FAA's] control or supervision. 55 Fed. Reg. 27548, 27551 (Jul. 3, 1990) (Discussion ofFinal Rule). This bright line separation is necessary to maintain not only a fair adjudication system but also to preserve the appearance offairness.5 It also promotes confidence that any subsequent appellate involvement by the FAA Administrator will be thoughtful and fair. Thus, the FAA regulations provide that after a U.S. Administrative Law Judge fully and independently adjudicates the civil penalty proceeding and issues an Initial Decision, the FAA Administrator-who has not been involved in any way in the adjudication-may then serve as the first appeal tribunal ifeither the FAA Regional Counsel or the Respondent files an appeal from the Judge's Decision. See, 14 C.F.R. §§ 13.202, 13.203, and 13.233. This procedural separation ofthe FAA Administrator from the adjudication presumptively allows the parties to maintain confidence in any appellate review by the FAA Administrator. See, 14 C.F.R. 

### §§ 13.233, 13.234, & 13.235. Then, once the FAA Administrator issues an appellate decision, either party may pursue any further appeal ofissues with the U.S. Court ofAppeals. 14 C.F.R. §13.235. In short, the parties inthis case (and any other FAA civil penalty case referred to this Court) should correctly identify the Court in this case in all its future filings. This allows the respondent litigants (and members ofthe public) to be confident that Court is independent, and that the FAA remains committed to an administrative adjudication system that is fair and impartial.

5 See 55 Fed. Reg. 27548, 27551 (Jul. 3, 1990) (Discussion ofFinal Rule) ("[I]t is important that a system of adjudication be perceived as fair by those who are subject to it, not simply that it actually operate fairly.") Page 3 of4

### B. Conclusion Pursuant to 14 C.F.R. § 13.205, and after reviewing all relevant caselaw, regulation, statutory authority, and being fully advised; 

### IT IS HEREBY ORDERED: 1. The parties shall stop identifying the FAA as part ofthe Court inthis action. 2. The parties shall also utilize the properjurisdictional caption for all future filings (see, e.g., thejurisdiction caption onpage 1ofthis Order).

ivan A'd:mt. m1strative LawJudge
Attachment: Service List

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### Mr. Brian K. Khan Complainant's Counsel Office ofthe Regional Counsel 

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